What is the Impact of Crypto on Child Support?

What is the impact of crypto on child support? Since the launch of Bitcoin in 2009, and a host of other different types of crypto coins coming to the fore henceforth, cryptocurrencies as such have had a tremendous and notable impact on the financial sector.

However, its influence can be seen over and above the world of finance. It has, in fact, affected all different sectors of different industries.

Quite surprisingly, crypto has also influenced the law sector and has impacted legal obligations regarding alimony and child support as well.

Over the years, cryptocurrencies have become one of the most popular and extraordinary ways to accumulate wealth.

Therefore, it is highly likely that a person who is liable to pay child support will like to know whether or not his or her crypto holdings will be affected or taken into account in the case of failing to pay child support.

Such a thought may come to your mind knowing that crypto transactions are anonymous and it is out of the control and regulation of the government.

If you too are wondering how, this is an article that will clarify all your doubts.

This article entails all those important aspects of child support and the laws and legal obligations regarding it.

Through this article, you will come to know what may happen to the crypto holdings, should a person facing such obligations have some, apart from the general assets.

You will also know what the role of the court in such situations is, what are the responsibilities of the parents along with other vital things.

What is the Impact of Cryptocurrency on Child Support?

What is the Impact of Crypto on Child Support

Cryptocurrency is a virtual asset that has a huge potential to offer a viable and profitable source of income.

The blockchain technology or the cryptographic protocols make the transactions safe and secure.

The most important factor of cryptocurrency is that unlike fiat currencies these are not governed by any external central authority or the government.

Coming to the price factor of cryptocurrencies, it fluctuates wildly due to the volatility.

Therefore, the value of 20 Bitcoin will not be equal to 20 dollars. In fact, it will be equal to hundreds of thousands of dollars.

Now you may ask, what does this mean and what is the relation of all these with child support. Well, there indeed is some relation.

Ideally, all crypto coins, including Bitcoin and Altcoins, are considered to be an asset or income, just like any other, according to the law.

This means that when you invest your crypto coins in any type of stock, it will be considered as an asset.

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And, if you earn dividends or any other kind of benefits from your investments, it will be considered as your income.

All these will be taken into consideration when it comes to calculating your legal obligations in the case of divorce and child support.

Typically, according to the law, any and every source of income will be considered and computed while calculating support obligations.

For example, if you made an investment of the cryptocurrency during your marriage, then your spouse will also have a right and interest in that specific investment.

It is much similar to the other investments that you may make during your marriage.

And naturally, while calculating child support, such investments and income from them will also be taken into account by dividing the investments.

Therefore, you can see that your crypto holdings have quite a significant impact and play a significant role in calculating child support.

Responsibility of Parents

It goes without saying that your child is your responsibility.

According to the law, every parent has the responsibility to support his or her child if they have to maintain their parental rights.

The law also states that any and every type of income of the parents is to be taken into account while calculating the amount and setting up the child support order, and this includes income from crypto, such as Bitcoin.

Now the question is – how much do you have to pay for child support?

Well, that amount is determined by considering several different factors such as:

  • The number of children you have
  • Whether all of them need child support
  • How much they need as child support and
  • The level of income of both the parents.

In addition to that, the court will also consider whether or not the child or the children have any additional needs as well as the standard of living they are accustomed to maintain.

It is only after a thorough and proper consideration of all these factors a child support order will be set up by the court.

Typically, the sum of child support granted has to be enough to meet all the basic needs of the child and it should also be adequate for the child or children to continue maintaining their current standard of living.

The reason behind considering crypto or Bitcoin in particular, for child support in spite of it being a virtual currency is that money is money irrespective of its form, whether it is virtual or real.

Therefore, according to the law, crypto may be considered and utilized when it comes to paying child support.

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On the other hand, the responsibility of the parents also includes disclosing all of the possible info regarding their income, and of all the types of it.

This is a very important factor when it comes to figuring out the amount of child support.

Sadly, when it comes to crypto, people do try to hide it thinking that it is anonymous and untraceable in an effort to simply reduce the amount of child support they have to pay.

Morally, this is nothing but depriving their own child from what they rightfully deserve.

This also makes it quite difficult for the parent who depends on such support to provide their children the basic needs.

And legally, such parents who rely on child support can take help of a legal counsel so that they can take all the necessary steps within the peripheries of law to provide their children with the proper care and ensure a proper upbringing.

Therefore, there is no point hiding the income sources.

If these are not listed or available to the court, the child will not get the right support amount. Period.

Role of the Court

The court plays a significant role in setting up a child support order and calculating the amount for it.

For this they need all available info about the incomes of both the parents including profits made from crypto trading.

Typically, it is the court that decides who gets the crypto after a break-up and then utilizes it to determine the child support amount.

And, it is the court that has the right to make the ultimate decision.

For example, if a mother of a child demands for an increase in child support and the father argues that his income was inflated due to non-recurring capital gains made from trading Bitcoin and other crypto coins, the court will intervene.

It is the court that will decide whether or not it should be included while calculating the actual income of the father and determining the child support amount.

And, if the court feels that there is a need to increase the amount of child support it may decide to consider the estimated income for the given period.

However, this is not the universal rule. It is at the discretion of the court to reject all of such appeals where the average income of the parent for five years is considered.

Instead, the court can take a position to rule that income of the previous year in particular should be considered to figure out the child support amount.

This will however depend on the information available currently on the income of the parents as well as the evidence presented by both of them.

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Moreover, the court can sometimes allow at its discretion to consider the average income of a parent for the past three years irrespective of the gains or losses made from crypto during that period.

However, this, once again, will depend on whether or not a fair income determination can be made.

Depending on the financial health of the parent and the information available about their income, the court may also pass a temporary motion for child support.

It may further order that the monthly amount for child support be raised up to a specific sum of money.

Ideally, the depiction of the capital gains of the father made from ordinary as well as crypto assets is the most significant issue.

This is however resolved by the court at trial in combination with the retroactive claim for child support as well as the chances of the father’s income increasing in the future.

Sometimes, in such situations, the court may also order for a settlement meeting scheduled with the parents to resolve the issues quickly and to ensure that the child does not suffer.

Back-owed Child Support

Now, all these are with regards to setting up a new order for child support.

You may ask at this point what about the back-owed child support? Will your crypto be taken into account, and even garnished, for back-owed child support?

Well, in that case your crypto cannot be garnished but it can surely be levied.

This is because garnishments are typically done for wages and other incomes earned.

On the other hand, levies are usually for the property that you currently own, and crypto is a property, as said earlier.

Therefore, cryptocurrency can in principle be legally utilized to persuade back-owed child support.


Since cryptocurrency is considered as an asset by the law, it will have a notable impact while calculating the amount of child support.

However, it is quite a challenge by itself and the court will need to intervene, as it is pointed out in this article.